Pottery Barn 2005 Annual Report Download - page 63

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Note D: Income Taxes
The components of earnings before income taxes, by tax jurisdiction, are as follows:
Fiscal Year Ended
Dollars in thousands Jan. 29, 2006 Jan. 30, 2005 Feb. 1, 2004
United States $ 337,468 $ 303,986 $ 252,119
Foreign 11,330 6,219 3,519
Total earnings before income taxes $ 348,798 $ 310,205 $ 255,638
The provision for income taxes consists of the following:
Fiscal Year Ended
Dollars in thousands Jan. 29, 2006 Jan. 30, 2005 Feb. 1, 2004
Current payable
Federal $ 131,242 $ 105,096 $ 87,194
State 19,002 17,642 15,640
Foreign 4,479 2,487 2,065
Total current 154,723 125,225 104,899
Deferred
Federal (18,912) (6,168) (3,587)
State (1,538) (70) (2,015)
Foreign (341) (16) (870)
Total deferred (20,791) (6,254) (6,472)
Total provision $ 133,932 $ 118,971 $ 98,427
Except where required by U.S. tax law, no provision was made for U.S. income taxes on the cumulative
undistributed earnings of our Canadian subsidiary, as we intend to utilize those earnings in the Canadian
operations for an indefinite period of time and do not intend to repatriate such earnings.
Accumulated undistributed earnings of our Canadian subsidiary were approximately $13,440,000 as of
January 29, 2006. It is currently not practical to estimate the tax liability that might be payable if these foreign
earnings were repatriated.
A reconciliation of income taxes at the federal statutory corporate rate to the effective rate is as follows:
Fiscal Year Ended
Jan. 29, 2006 Jan. 30, 2005 Feb. 1, 2004
Federal income taxes at the statutory rate 35.0% 35.0% 35.0%
State income tax rate, less federal benefit 3.4% 3.4% 3.5%
Total 38.4% 38.4% 38.5%
51
Form 10-K